Springfield Clinic, LLP v. Primex Clinical Laboratories, Inc.

• Court: District Court, C.D. California
• Decided: April 29, 2022
• Docket: 2:21-cv-03595
• Status: Unknown

Opinion

Case 2:21-cv-03595-RSWL-AS Document 77 Filed 04/29/22 Page 1 of 16 Page ID #:628 'O' 1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 CENTRAL DISTRICT OF CALIFORNIA 10 11 CV 21-03595-RSWL-ASx 12 SPRINGFIELD CLINIC, LLP, ORDER re: MOTION TO 13 Plaintiff, DISMISS FIRST AMENDED 14 v. COUNTERCLAIM [71] 15 PRIMEX CLINICAL 16 LABORATORIES, INC., 17 Defendant. 18 PRIMEX CLINICAL 19 LABORATORIES. INC., 20 Third-Party Plaintiff, 21 v. 22 23 TBS BUSINESS SOLUTIONS USA INC.; and TEWODROS SAHILU, 24 Third-Party Defendants. 25 26 27 28 1 Case 2:21-cv-03595-RSWL-AS Document 77 Filed 04/29/22 Page 2 of 16 Page ID #:629

1 TBS BUSINESS SOLUTIONS USA INC., 2 Counterclai m-Plaintiff, 3 v. 4 5 PRIMEX CLINICAL LABORATORIES INC.; STUDEBAKER DEFENSE 6 GROUP, LLC; GLENN HILL; TOM MARX; and ROES 1 to 10, 7 8 Counterclaim-Defendants. 9 10 Springfield Clinic, LLP (“Springfield”) initiated 11 this Action on April 28, 2021, against Primex Clinical 12 Laboratories, Inc. (“Primex”). Primex then filed a 13 third-party complaint (“Primex Complaint”) against TBS 14 Business Solutions USA Inc. (“TBS”) on July 7, 2021. 15 TBS then filed a third-party complaint against Glen 16 Hill, Tom Marx, and Studebaker Defense Group, LLC 17 (collectively, “Studebaker Defendants”) on October 5, 18 2021. After the Court granted Studebaker Defendants’ 19 motion to dismiss TBS’s third-party complaint, TBS 20 amended its Answer to the Primex Complaint to include 21 counterclaims against Studebaker Defendants. Currently 22 before the Court is Studebaker Defendants’ Motion to 23 Dismiss TBS’s First Amended Counterclaim (the “Motion”). 24 Having reviewed all papers submitted pertaining to this 25 Motion, the Court NOW FINDS AND RULES AS FOLLOWS: the 26 Court GRANTS the Motion. 27 /// 28 /// 2 Case 2:21-cv-03595-RSWL-AS Document 77 Filed 04/29/22 Page 3 of 16 Page ID #:630

1 I. BACKGROUND

2 A. Factual Background

3 Springfield is a multi-specialty physician practice 4 that provides health care to the central Illinois 5 community. Compl. (“Springfield Compl.”) ¶ 6, ECF No. 6 1. Around April 2020, Springfield contracted with 7 Primex, a clinical laboratory that provides diagnostic 8 services, for Primex to provide Springfield with 1 9 million 3M-branded N95 masks. Id. ¶¶ 10-11. 10 Through April, May, and June of 2020, Primex 11 entered into a series of transactions to purchase 1 12 million 3M masks from TBS, a supplier and distributor of 13 various products. Third-Party Compl. (“Primex Compl.”) 14 ¶¶ 14, 17-18, ECF No. 14. TBS allegedly represented to 15 Primex that it would give Primex priority in the 16 allocation of masks because Primex was a first 17 responder, and TBS could obtain 3M products quicker than 18 any other wholesaler. Id. ¶ 18. Thus, Primex tendered 19 the sum of $970,000 to TBS in exchange for 1 million 3M 20 masks.1 Id. ¶ 19. However, TBS failed to deliver masks 21 to Primex sufficient to satisfy any of Primex’s purchase 22 orders. Id. ¶ 20. TBS satisfied only a portion of a 23 purchase order in some instances, and it offered a 24

25 1 Primex also ordered masks from TBS to fill purchase orders other than the Springfield purchase order. Id. ¶ 17. In 26 particular, Primex placed an additional order with TBS for 1.5 million masks in exchange for $1,455,000. Id. Primex is seeking 27 recovery from TBS for those additional orders in this suit as well, bringing its damages request to a total of $2,220,731.20. 28 Id. ¶ 17 Table 1; id. Prayer for Relief. 3 Case 2:21-cv-03595-RSWL-AS Document 77 Filed 04/29/22 Page 4 of 16 Page ID #:631

1 substitute product to fill the order in others. Id.

2 ¶¶ 21, 23. TBS also refunded Primex a portion of the

3 money it had paid. Id. ¶ 22. However, Primex alleges 4 that TBS refuses to either perform its remaining 5 obligations under their contract or to refund Primex the 6 remaining balance it is owed. Id. ¶ 25. 7 Meanwhile, when TBS was unable to obtain 3M masks 8 through other suppliers, it sought to fulfill the Primex 9 order through Studebaker Defense Group, LLC 10 (“Studebaker”). TBS First Am. Countercl. to Primex 11 Compl. (“TBS FACC”) ¶¶ 17-19, ECF No. 60. Studebaker 12 allegedly represented that it could supply TBS with 1 13 million Honeywell-branded masks by November 20, 2020, 14 and with 1.5 million Honeywell-branded masks by January 15 15, 2020. Id. ¶ 18. In reliance on this 16 representation, on October 19, 2020, TBS ordered 1 17 million masks from Studebaker at a cost of $960,000, to 18 be delivered on November 20, 2020 (“PO1”). Id. ¶ 19. 19 TBS cancelled pending orders it had placed with other 20 suppliers. Id. ¶ 20. On November 23, 2020, TBS learned 21 that Honeywell had informed Studebaker that PO1 may not 22 be fulfilled until as late as March 1, 2021. Id. ¶ 21. 23 TBS and Primex consequently entered into revised 24 purchase orders that reflected a later delivery date. 25 Id. ¶ 22. TBS paid Studebaker $960,000 for PO1 on 26 December 2, 2020. Id. ¶ 24. 27 On December 4, 2020, TBS ordered 1.5 million 28 Honeywell masks from Studebaker at a cost of $1,440,000, 4 Case 2:21-cv-03595-RSWL-AS Document 77 Filed 04/29/22 Page 5 of 16 Page ID #:632

1 to be delivered by January 15, 2021 (“PO2”). Id. ¶ 26.

2 TBS paid Studebaker for PO2 on December 8, 2020. Id.

3 After several discussions between TBS and Studebaker and 4 a partial fulfillment of the order, however, Studebaker 5 failed to supply TBS with masks sufficient to fill PO1 6 or PO2 by the specified dates. Id. ¶¶ 27-32. On April 7 16, 2021, Primex demanded that its revised orders with 8 TBS be cancelled, and TBS requested that Studebaker 9 cancel PO2 that same day. Id. ¶ 33. Studebaker then 10 informed TBS that the outstanding mask deliveries for 11 both PO1 and PO2 would soon be ready to ship. Id. ¶¶ 12 35. TBS did not receive these shipments, and on May 20, 13 2021, TBS reached out to Honeywell directly regarding 14 PO1 and PO2. Id. ¶ 37. Honeywell allegedly informed 15 TBS that it had fulfilled all of Studebaker’s purchase 16 orders. Id. TBS contends that Studebaker has delivered 17 only $260,000 worth of masks and that TBS has thus 18 suffered damages in excess of $2,180,000. Id. ¶¶ 58-59. 19 B. Procedural Background 20 Springfield initiated this Action [1] on April 28, 21 2021, against Primex. Primex impleaded TBS and filed a 22 third-party complaint (“Primex Complaint”) [14] against 23 TBS on July 7, 2021. TBS then impleaded Studebaker 24 Defendants and filed a third-party complaint (“TBS 25 Complaint”) [29] against them on October 5, 2021. 26 Studebaker Defendants moved to dismiss [49] the TBS 27 Complaint on December 1, 2021. The Court granted [57] 28 Studebaker Defendants’ motion on January 6, 2022, 5 Case 2:21-cv-03595-RSWL-AS Document 77 Filed 04/29/22 Page 6 of 16 Page ID #:633

1 concluding that TBS had improperly joined Studebaker

2 Defendants to this Action under Rule 14 of the Federal

3 Rules of Civil Procedure. With its third-party 4 complaint dismissed, TBS then amended [60] its Answer to 5 the Primex Complaint on January 19, 2022, to include 6 counterclaims (“FACC”) against Studebaker Defendants 7 that are nearly identical to the claims it had alleged 8 against Studebaker Defendants in the TBS Complaint. 9 Studebaker Defendants filed the instant Motion to 10 Dismiss [71] on March 29, 2022. TBS opposed [72] the 11 Motion to Dismiss on April 5, 2022. Studebaker 12 Defendants replied [73] on April 12, 2022. 13 II. DISCUSSION 14 A. Legal Standard 15 1. Rule 13(h) 16 Rule 13(h) of the Federal Rules of Civil Procedure 17 allows for new parties to be joined to an action by 18 adding them to a counterclaim or crossclaim. However, 19 courts have interpreted this rule to require that 20 joinder of a new party be anchored to an existing 21 counterclaim or crossclaim pleaded against an original 22 party. See Hawkins v. Berkeley Unified Sch. Dist., 250 23 F.R.D. 459, 462 (N.D. Cal. 2008); see also 6 Wright & 24 Miller, Federal Practice and Procedure § 1435 (3d ed. 25 2010) (“[A] counterclaim or crossclaim may not be 26 directed solely against persons who are not already 27 parties to the original action, but must involve at 28 least one existing party.”). If this requirement is 6 Case 2:21-cv-03595-RSWL-AS Document 77 Filed 04/29/22 Page 7 of 16 Page ID #:634

1 met, then joinder of additional parties is proper if it

2 satisfies the requirements of either Rule 19 or Rule 20.

3 Fed. R. Civ. P. 13(h). 4 Rule 19 requires a person to be joined as a party 5 if: (1) in that person’s absence, the court cannot 6 afford complete relief among existing parties; or (2) an 7 absent party claims an interest relating to the subject 8 of the action and resolving the action in that person’s 9 absence would harm either the absent party or an 10 existing party. Fed. R. Civ. P. 19(a)(1). Rule 20, 11 which governs permissive joinder, allows joinder of 12 defendants where “any right to relief is asserted 13 against them jointly, severally, or in the alternative . 14 . . arising out of the same transaction, occurrence, or 15 series of transactions or occurrences.” Fed. R. Civ. P. 16 20(a). 17 2. Rule 12(b)(6) 18 Rule 12(b)(6) of the Federal Rules of Civil 19 Procedure allows a party to move for dismissal of one or 20 more claims if the pleading fails to state a claim upon 21 which relief can be granted. A complaint must “contain 22 sufficient factual matter, accepted as true, to state a 23 claim to relief that is plausible on its face.” 24 Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quotation 25 omitted). Dismissal is warranted for a “lack of a 26 cognizable legal theory or the absence of sufficient 27 facts alleged under a cognizable legal theory.” 28 Balistreri v. Pacifica Police Dep’t, 901 F.2d 696, 699 7 Case 2:21-cv-03595-RSWL-AS Document 77 Filed 04/29/22 Page 8 of 16 Page ID #:635

1 (9th Cir. 1988) (citation omitted). 2 In ruling on a 12(b)(6) motion, a court may

3 generally consider only allegations contained in the 4 pleadings, exhibits attached to the complaint, and 5 matters properly subject to judicial notice. Swartz v. 6 KPMG LLP, 476 F.3d 756, 763 (9th Cir. 2007). A court 7 must presume all factual allegations of the complaint to 8 be true and draw all reasonable inferences in favor of 9 the non-moving party. Klarfeld v. United States, 944 10 F.2d 583, 585 (9th Cir. 1991). The question is not 11 whether the plaintiff will ultimately prevail, but 12 whether the plaintiff is entitled to present evidence to 13 support its claims. Jackson v. Birmingham Bd. of Educ., 14 544 U.S. 167, 184 (2005) (quoting Scheuer v. Rhodes, 416 15 U.S. 232, 236 (1974)). While a complaint need not 16 contain detailed factual allegations, a plaintiff must 17 provide more than “labels and conclusions” or “a 18 formulaic recitation of the elements of a cause of 19 action.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 20 (2007). 21 B. Analysis 22 1. The Motion 23 Rule 13(h) of the Federal Rules of Civil Procedure 24 provides that: “Rules 19 and 20 govern the addition of a 25 person as a party to a counterclaim or crossclaim.” The 26 Court concludes that TBS’s joinder of Studebaker 27 Defendants through the FACC fails to satisfy the 28 requirements of either Rule 19 or Rule 20. Studebaker 8 Case 2:21-cv-03595-RSWL-AS Document 77 Filed 04/29/22 Page 9 of 16 Page ID #:636

1 Defendants were thus improperly joined to this Action,

2 and the Court GRANTS Studebaker Defendants’ Motion on

3 this basis.2 4 i. Rule 19 5 Rule 19 sets forth the circumstances under which 6 persons must be joined to a lawsuit as necessary 7 parties. Disabled Rights Action Comm. v. Las Vegas 8 Events, Inc., 375 F.3d 861, 878 (9th Cir. 2004). “Under 9 Rule 19(a), a party may be deemed ‘necessary’ in either 10 of two ways.” Id. at 879. 11 First, a person must be joined to an action where 12 the court cannot accord complete relief among the 13 existing parties in that person’s absence. Fed. R. Civ. 14 P. 19(a)(1)(A). This inquiry “is concerned only with 15 relief as between the persons already parties, not as 16 between a party and the absent person whose joinder is 17 sought.” Altmann v. Republic of Austria, 142 F. Supp. 18 2d 1187, 1211 (C.D. Cal. 2001). Here, Primex seeks 19 2 As an initial matter, the parties dispute whether Rule 13(h) contains an additional requirement. Studebaker Defendants 20 argue that, in order to properly join a new party through a 21 counterclaim, at least one counterclaim must be asserted against both an existing party and the nonparty. Studebaker Defs.’ Mot. 22 to Dismiss TBS FACC (“Mot.”) 5:27-6:1, ECF No. 71. TBS, on the other hand, argues that counterclaims may be alleged against new 23 parties so long as at least one separate counterclaim is also alleged against an existing party in the same pleading. TBS’s 24 Opp’n to Mot. (“Opp’n”) 5:5-9, ECF No. 72. The parties rely on 25 decisions with conflicting interpretations of Rule 13(h), none of which are binding upon this Court. See, e.g., AllTech Commc’ns, 26 LLC v. Brothers, 601 F. Supp. 2d 1255 (N.D. Okla. 2008); Various Mkts., Inc. v. Chase Manhattan Bank, N.A., 908 F. Supp. 459 (E.D. 27 Mich. 1995). However, the Court need not determine which interpretation is correct given TBS’s failure to satisfy either 28 Rule 19 or Rule 20. 9 Case 2:21-cv-03595-RSWL-AS Document 77 Filed 04/29/22 Page 10 of 16 Page ID #:637

1 relief against TBS for TBS’s alleged breach of the

2 Primex-TBS contracts. See Primex Compl. ¶¶ 26-66

3 (pleading breach of contract in Count 1 and all other 4 claims in the alternative to Count 1). In its FACC, TBS 5 seeks relief against Primex for Primex’s alleged breach 6 of the Primex-TBS contracts. See TBS FACC ¶¶ 46-51. 7 The parties can obtain complete relief on these 8 claims without the addition of Studebaker Defendants to 9 this Action. Studebaker Defendants were not parties to 10 the Primex-TBS contracts, and their presence in this 11 Action is therefore unnecessary to determine the rights 12 afforded by those agreements. See Nat. Res. Def. 13 Council v. Kempthorne, 539 F. Supp. 2d 1155, 1184 (E.D. 14 Cal. 2008) (concluding that parties to a separate but 15 related contract were not necessary parties to contract 16 action because each contract was “a standalone and 17 separate contract, the validity of which does not depend 18 on whether other [contracts] are rescinded [or] 19 invalidated”). 20 Second, a person must be joined to an action where 21 necessary to protect the person’s legally cognizable 22 interests or to prevent other parties from a substantial 23 risk of incurring multiple or inconsistent obligations 24 because of those interests. Fed. R. Civ. P. 25 19(a)(1)(B). Here, Studebaker Defendants have no 26 legally cognizable interests that could be affected by 27 the claims brought by Primex and TBS against one 28 another. Those claims involve only the Primex-TBS 10 Case 2:21-cv-03595-RSWL-AS Document 77 Filed 04/29/22 Page 11 of 16 Page ID #:638

1 contracts, to which Studebaker Defendants were not a

2 party, and the obligations those parties owed to one

3 another, none of which involved Studebaker Defendants. 4 Studebaker Defendants’ interests are governed by the 5 contracts between TBS and Studebaker only, which will be 6 unaffected by the claims Primex and TBS have brought 7 against one another. Therefore, joinder of Studebaker 8 Defendants to this Action is not necessary to protect 9 Studebaker Defendants’ legal interests. See Disabled 10 Rights Action Comm., 375 F.3d at 881 (holding that a 11 party was not necessary to an action where a judgment in 12 action would not affect party’s contractual rights, even 13 if judgment would lead that party to sue for breach to 14 enforce those contractual rights). 15 Similarly, no ruling in this case would pose a risk 16 of inconsistent obligations amongst the parties. “The 17 focus of Rule 19(a)(1)(B)(ii) is on inconsistent 18 obligations, not inconsistent adjudications. 19 Inconsistent obligations occur when a party is unable to 20 comply with one court’s order without breaching another 21 court’s order concerning the same incident. 22 Inconsistent adjudications or results, by contrast, 23 occur when a defendant successfully defends a claim in 24 one forum, yet loses on another claim arising from the 25 same incident in another forum.” Kempthorne, 539 F. 26 Supp. at 1190 (internal quotation marks and citations 27 omitted). 28 Here, there is no risk of inconsistent rulings 11 Case 2:21-cv-03595-RSWL-AS Document 77 Filed 04/29/22 Page 12 of 16 Page ID #:639

1 because the outcome of TBS’s claims against Primex and

2 Studebaker Defendants are not dependent on one another.

3 For example, a conclusion that TBS is liable to Primex 4 based on the Primex-TBS contracts or transactions would 5 not be inconsistent with a finding that Studebaker 6 Defendants are not liable to TBS based on the TBS- 7 Studebaker contracts or transactions.3 As the Court 8 stated in its previous Order, the claims between Primex 9 and TBS, on the one hand, and TBS and Studebaker 10 Defendants, on the other, are completely independent. 11 See Order re: Mot. to Dismiss 10:15-18, ECF No. 57 12 (“[E]ven if TBS is found to have breached its contract 13 with Primex, it does not follow that Studebaker 14 Defendants must be liable to TBS either in contract or 15 in tort.”). 16 Because Studebaker Defendants are not necessary 17 parties under any of the definitions provided in Rule 18 19(a), Studebaker Defendants may not be properly joined 19 to this Action pursuant to Rule 19. 20 ii. Rule 20 21 A party seeking joinder under Rule 20 must assert: 22 23 3 TBS argues that the relief sought by the parties is interrelated because, for example, if Studebaker Defendants are 24 found liable for TBS’s misrepresentation or conversion claims, 25 then Primex’s claims against TBS for conversion and unjust enrichment must fail. See Opp’n 7:21-8:1. Plaintiff fails to 26 explain why this is the case, as the liability between the parties are guided by two entirely separate sets of facts. TBS’s 27 liability to Primex for conversion or unjust enrichment is dependent only on TBS’s conduct during transactions with Primex, 28 not on any wrongdoing committed by Studebaker Defendants. 12 Case 2:21-cv-03595-RSWL-AS Document 77 Filed 04/29/22 Page 13 of 16 Page ID #:640

1 “(1) a right to relief based on the same transaction or

2 occurrence, and (2) a common question of law or fact

3 with respect to all parties.” Wynn v. Nat’l Broad. Co., 4 Inc., 234 F. Supp. 2d 1067, 1078 (C.D. Cal. 2002). Even 5 if these requirements are satisfied, however, courts 6 have discretion to refuse joinder after considering 7 whether joinder comports with principles of fundamental 8 fairness. Id. 9 Here, TBS’s claims against Studebaker Defendants 10 are not based on the same set of transactions or 11 occurrences as the claims between TBS and Primex. The 12 claims between TBS and Primex are based upon the Primex- 13 TBS contracts and the statements made by those parties 14 to one another, while TBS’s claims against Studebaker 15 Defendants are based on the statements and promises made 16 by Studebaker Defendants both directly and through PO1 17 and PO2. See Order re: Mot. to Dismiss 9:22-11:4) 18 (highlighting some of the differences between the facts 19 relevant to each set of claims). The transactions 20 giving rise to Studebaker Defendants’ alleged liability 21 are thus completely distinct from those giving rise to 22 the alleged liability of either TBS or Primex. See 23 Martinez v. Encore Credit Corp., 2009 WL 3233531, No. CV 24 09-5490 AHM (AGRx), at *2 (C.D. Cal. Sept. 30, 2009) 25 (concluding that it was “obvious from the face of the 26 Complaint” that joinder was improper because each claim 27 involved different transactions with different parties 28 and “numerous different factual circumstances”). The 13 Case 2:21-cv-03595-RSWL-AS Document 77 Filed 04/29/22 Page 14 of 16 Page ID #:641

1 fact that the agreements all involved the same desired

2 product is insufficient given the distinctness of the

3 parties’ contracts and relationships. 4 TBS argues that joinder of Studebaker Defendants 5 under Rule 20 is permissible because if TBS is held 6 liable to Primex, it is because of Studebaker 7 Defendants’ failure to deliver goods and Studebaker 8 Defendants will therefore owe TBS damages. Opp’n 9:6-9. 9 This argument merely reiterates TBS’s position that 10 Studebaker Defendants should be held derivatively liable 11 for TBS’s liability to Primex, which the Court discussed 12 at length and ultimately rejected in its previous Order. 13 See Order re: Mot. to Dismiss 9:18-15:18. The FACC 14 contains no new allegations that might establish 15 derivative liability, so the Court declines to repeat 16 its prior conclusions here.4 17

18 4 TBS’s reliance on Amalgamated Packaging Indus., Ltd. v. Nat’l Container Corp., 14 F.R.D. 194 (S.D.N.Y. 1953), to argue 19 that Primex should be treated as TBS’s principal or a third-party beneficiary of PO1 and PO2 is unpersuasive. In Amalgamated, the 20 complaint specifically alleged that one of the plaintiffs was 21 both the second plaintiff’s principal and a third-party beneficiary to the contract between the second plaintiff and the 22 defendant. Id. at 196. No such relationships were alleged here. See generally TBS FACC. Moreover, the contract between the two 23 plaintiffs in Amalgamated included a promise to order and procure the desired product from the specifically named defendant. Id. 24 at 195. This promise in the contract between the two plaintiffs 25 to obtain the product from a particular source made the principal-agent and third-party beneficiary allegations 26 plausible. Here, however, TBS did not promise Primex that it would obtain the masks from any particular source. See TBS FACC 27 Ex. B, ECF No. 60-2. It is thus unclear how Primex could be considered a principal of TBS or a third-party beneficiary to 28 TBS’s dealings with Studebaker. 14 Case 2:21-cv-03595-RSWL-AS Document 77 Filed 04/29/22 Page 15 of 16 Page ID #:642

1 TBS’s joinder attempt also fails under the second

2 prong of the permissive joinder test because TBS’s claim

3 against Primex and its claims against Studebaker 4 Defendants would require individualized attention. See 5 Coughlin v. Rogers, 130 F.3d 1348, 1351 (9th Cir. 1997) 6 (finding a lack of common questions of law or fact where 7 each party’s claim would require “personalized 8 attention”). The Court recognizes that joinder rules 9 are to be construed liberally to promote judicial 10 efficiency, but that policy would not be furthered by 11 adjudicating claims between separate parties under 12 separate contracts within a single action. See Order 13 re: Mot. to Dismiss (“[E]ach complaint describes an 14 entirely distinct set of events and transactions that 15 relate to one another only in the sense that they both 16 involved purchase of the same type of product.”). 17 Accordingly, the Court GRANTS Studebaker 18 Defendants’ Motion to Dismiss because TBS’s joinder of 19 Studebaker Defendants was improper under Rule 13(h). 20 2. Leave to Amend 21 “The court should give leave [to amend] freely when 22 justice so requires.” Fed. R. Civ. P. 15(a)(2). In the 23 Ninth Circuit, “Rule 15’s policy of favoring amendments 24 to pleadings should be applied with ‘extreme 25 liberality.’” United States v. Webb, 655 F.2d 977, 979 26 (9th Cir. 1981). Against this liberal standard, the 27 Court may consider “the presence of any of four factors: 28 bad faith, undue delay, prejudice to the opposing party, 15 Case 2:21-cv-03595-RSWL-AS Document 77 Filed 04/29/22 Page 16o0f16 Page ID #:643

1] and/or futility.” Owens v. Kaiser Found. Health Plan, 2] Inc., 244 F.3d 708, 712 (9th Cir. 2001). 3 TBS has now had two attempts to plead facts showing 4] that joinder of Studebaker Defendants to this Action is 5 | proper. TBS has failed to do so. Because TBS’s claims 6 | against Primex and Studebaker Defendants involve 7 | distinct factual patterns and legal obligations, the 8 | Court finds that any further opportunity to amend would 9] be futile. If TBS wishes to pursue its claims against 10 | Studebaker Defendants, it must do so through a separate 11 | action. See Hawkins, 250 F.R.D. at 463 (noting that 12 | although joinder was improper under Rule 13(h), 13 | counterclaimant was “not necessarily without any relief” 14 | because it could initiate a separate suit against 15 counter-defendants). Therefore, the Court GRANTS 16 | Studebaker Defendants’ Motion without leave to amend the 17 | FACC. 18 III. CONCLUSION 19 Based on the foregoing, the Court GRANTS Studebaker 20 | Defendants’ Motion to Dismiss without leave to amend. 21] TBS’s counterclaims alleged in the FACC against 22 | Studebaker Defense Group, LLC; Glenn Hill; and Tom Marx 23 | are hereby DISMISSED with prejudice. 24 IT IS SO ORDERED. 25 26 | DATED: April 29, 2022 /s/ Ronald S.W. Lew 27 HONORABLE RONALD S.W. LEW Senior U.S. District Judge 28